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in Temecula, CA
Self-employed borrowers in Temecula have two strong non-QM mortgage options. Both 1099 loans and bank statement loans help you qualify without traditional W-2 income documentation.
These programs serve independent contractors, freelancers, and business owners throughout Riverside County. Each approach uses different methods to verify your income and ability to repay.
Choosing the right option depends on how you receive income and what documentation you have available. Understanding the differences helps you move forward with confidence.
1099 loans help independent contractors and freelancers who earn 1099 income qualify for mortgages. This program focuses specifically on income reported via 1099 forms from clients.
You verify income using your 1099 forms rather than traditional pay stubs or W-2s. This makes sense if you receive most income as a contractor rather than through business accounts.
Rates vary by borrower profile and market conditions. Lenders typically review your 1099 documentation along with tax returns to establish qualifying income.
Bank statement loans use 12 to 24 months of bank statements to verify income for self-employed borrowers. This non-QM option looks at actual deposits rather than tax returns.
Your business or personal bank statements show cash flow and income patterns. Lenders analyze deposits to calculate your qualifying income for the mortgage.
This approach works well if you write off significant business expenses. Rates vary by borrower profile and market conditions based on your overall financial picture.
The main difference is documentation type. 1099 loans rely on contractor income forms while bank statement loans examine actual account deposits.
Bank statement loans work better if you run income through business accounts with deductions. 1099 loans suit contractors who receive direct payments without operating complex business structures.
Both are non-QM products designed for self-employed Temecula residents. Your income structure and available documentation determine which path makes more sense for your situation.
Choose 1099 loans if you work primarily as an independent contractor receiving 1099 forms. This option is straightforward when contractor income is your primary documentation.
Pick bank statement loans if you operate a business with significant expenses or multiple income streams. This works when your bank deposits better represent earning power than tax returns.
Talk with a Temecula mortgage broker to review your specific situation. They can examine your documentation and recommend the best non-QM option for your home purchase or refinance.
Yes, many self-employed borrowers qualify for both options. Your mortgage broker will recommend the program that offers the best terms based on your specific income documentation.
Rates vary by borrower profile and market conditions for both programs. Your credit score, down payment, and income stability matter more than the specific loan type you choose.
Requirements vary by lender. Some 1099 loan programs require tax returns while bank statement loans often don't. Your broker can find options that match your available documentation.
Both loan types typically take 30-45 days from application to closing. Having your documentation organized upfront speeds up the process significantly.
Both 1099 loans and bank statement loans work for purchases and refinances in Temecula. You can use either program to buy a new home or refinance your existing mortgage.